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Tag Archives: CPG
How CPG Companies Can Reap the Benefits of PSAs
PSAs are not just for non-profit organizations. According to Ray Salo who pioneered the concept of “co-sponsored” PSAs, deregulation during the Regan administration provided a key opportunity for for-profit organizations to “co-sponsor” PSAs. For the last 10 years, Salo Productions has been developing co-sponsored PSAs that allow for-profit brands to increase awareness by acting as a credible source for the public on a key topic.
Intrigued by this marketing strategy, we sat down with Ray to evaluate how CPG companies can benefit from “co-sponsored” PSAs.
Q: What is a “co-sponsored” PSA?
A: A for-profit brand can partner with a non-profit and develop and distribute a PSA. For example, a search engine company co-sponsored a PSA with Web Wise Kids to promote Internet safety for children. The Internet safety PSA achieved more than 4,000 confirmed telecasts across the country.
This model is really a win-win-win. The non-profit gets a free ride. The for-profit organization builds brand and the TV or radio station receives good quality content they can share with viewers/listeners.
Q: What was the most successful “co-sponsored” PSA you produced/distributed?
A: “Two Causes of Asthma”, created for the Asthma & Allergy Foundation and a pharmaceutical company, is a great example of how successful “co-sponsored” PSAs can be.
The PSA aired on CNBC, MSNBC and the USA Network during the 2010 Winter Olympics in Vancouver. This PSA was aired 60,346 times, reached 131 million viewers and achieved $663,000 of airtime. The total cost of the PSA development and distribution was less than $45,000.
Q: How do you track results of the PSAs (how often it is played, what markets, audience reach, etc.)?
A: There are two methods we use to track the results. First, we use Neilson Sigma electronic tracking. This allows us to verify what station uses the PSA, how many times it is aired and when it is aired.
The second form of tracking is through BRCs (broadcast report cards). We ask the individual stations to complete and send us back a report of how many times they used the PSA. Surprisingly, the stations are very responsive to this.
Also, companies and non-profits can track website traffic based on when the PSA aired.
Q: What is one major misconception that exists about PSAs?
A: Besides the fact that people think PSAs can only be developed by non-profits, another major misconception is that PSAs air when no one is watching TV, or listening to the radio. In fact, 80% of PSAs are telecast from the time Good Morning America starts to the end of David Letterman, with morning, mid-morning, mid-day and early evening use. Only 20% occur “late night” from 1 a.m to 5 a.m.
Q: What is the typical time line of when a station receives a PSA to when it is aired? Also, how long will stations typically air a PSA?
A: It typically takes about a week from when a station receives a PSA to when it will begin airing. Also, on average PSAs will air for about 6 months, with the majority (about 75%) of telecasts occuring in the first 3 months. The remaining 25% of telecasts air the following 3 months.
Q: Can you target geographic regions with PSAs?
A: Absolutely. If you want to hit specific markets, then we simply focus on distributing the PSA to those markets.
Q: How has the success of PSAs been impacted by the current economic conditions? How will the 2012 political race, at a time when more advertising occurs, affect the success of PSAs?
A. Typically when companies are spending less on advertising, PSA use is up because stations still have to fill that time. PSA use is up about 20% from when the Great Recession started in 2008.
While more advertising tends to occur during key political races, like the presidential race in 2012, I really do not anticipate that PSA use will drop more than 5%. This is not a significant enough drop to really affect any marketers’ decisions to not use PSAs as a marketing strategy.
The only time I advise clients to not distribute PSAs is from November 1 to December 31, unless their message ties in during the holidays.
Consumer Shopping Trends Driving Retailer Changes
Changes occurring at Target and Walgreens directly effect consumer packaged good manufacturers.
Target Seeing Positive Sales Results from Addition of Fresh Foods
Target’s 2nd quarter profits rose 3.7%. The company credits the increase to adding fresh food to its stores. Target said sales rose from more consumers consolidating shopping trips at its location.
In contrast Walmart has experienced a ninth straight quarter of negative same store sales. While Walmart has said it is seeing sequential monthly improvements, consumers are purchasing smaller pack sizes of products.
However, not all consumers are tightening their budgets. Target is seeing some of its consumers trading up to higher end brands like Smith & Hawken and Fieldcrest.
“Across all of retail, the 20% of households with the highest incomes are shopping more often and spending more, while the other 80% have been cutting trips and spending less,” said Target’s merchandising chief Kathy Tesija on a conference call. “Some of these trends are visible in our own results.”
Target’s core customer has a median household income of $55,000. Some analysts have said Walmart’s core customer has a household income in the low $40,000s.
Walgreens to Create More Competition for CPG Companies
Walgreens has consolidated its store brands and introduced a 
new private label brand – Nice! Nice! will include more than 400 high quality grocery and household products at prices up to 30% below other national brands, according to a news release from Walgreens.
The new Walgreens’ brand will start appearing on store shelves in early 2012. It will feature non-conventional drug store brands, including soups, bakery, tea and rice.
According to A.C. Nielsen data, total private brand sales in the U.S. have increased from $64.9 billion in 2005 to $88.5 billion in 2010. The fastest growing store brand consumer segment is households with incomes more than $100,000.
The Perfect Storm of News Stories Gives Me an Idea.
Serendipity.
I gas up the computer this morning and begin the daily ritual of scanning all the news alerts that appear in my inbox. Side-by-side I read these two headlines:
Sara Lee launches multimedia campaign for deli meats and School kids’ sack lunches rise to unsafe temperatures, study finds
You can not plan this kind of thing. Anyway, I read both stories and realized that this does not have to be a bad thing for Sara Lee (I am assuming that the vast majority of their perfect deli meats find their way into school and/or daycare kid’s lunch bags). If I were Sara Lee, I would adopt this cause and find solutions. I must admit that I haven’t given this a lot of thought, but here are a couple of my initial ideas:
1. Align with an appliance manufacturer or retailer to launch a campaign goal of putting a portable refrigerator (like dorm size fridges) in every classroom in America (starting in the South).
2. Partner with an insulated lunch bag manufacturer or retailer to give every student in America a “Perfect-Lee Cool” lunch sack. At the very least, allow students/parents to earn points with every deli meat purchase that can be applied to the cost of the insulated bag.
3. Work with the Center for Disease Control and Prevention to increase awareness of the issue and bring an end to issue of unsafe lunches.
Memo to Sara Lee: There is a solution AND an opportunity for every problem; I hope you can find a perfect solution for this one… if you don’t, Spam might!
